Bitcoin Price Breaks All-Time High, Hits $1,300: Potential Factors
Bitcoin price officially reached $1,300 on April 26, surpassing its previous all-time high price at $1,277.
Bitcoin price officially reached $1,300 on April 26, surpassing its previous all-time high price at $1,277. This occurred minutes before the decision of the US Securities and Exchange Commission to deny the Winklevoss twins’ ETF was announced.
The Winklevoss Twins strike again
Most analysts seem to believe that the recent surge in Bitcoin price was caused by the SEC’s decision to re-examine the Bitcoin ETF proposal of the Winklevoss Twins. The commission accepted a petition submitted by BATS Global Markets and began a one month process to review the proposal of the COIN ETF once again.
"The news of the review has definitely excited speculators, although it's unclear if this will alter the SEC's decision. So the gains in the last 24 hours may be temporary," Thomas Glucksmann, head of marketing at regulated cryptocurrency trading platform Gatecoin, said in an interview.
However, the upward trend of Bitcoin price has maintained its momentum over the past week. It is difficult to conclude that the SEC’s recent ruling led to a surge in Bitcoin price as the demand for an ETF significantly decreased after its initial denial. More importantly, Bitcoin price recovered rapidly after the denial of the COIN ETF.
Thus, while the Bitcoin ETF re-examining process could be one of the factors to affect Bitcoin’s recent price surge, it isn’t the driving factor.
The recent price trend of Bitcoin is not organic
Rather, it is likely that the arbitrage in the US market caused by Bitfinex and other exchanges’ inability to process withdrawals and deposits in fiat money is causing Bitcoin price to increase at a rapid rate.
According to various Bitcoin market data providers including BraveNewCoin, Bitcoin price in the US, which holds 26.6 percent of the global Bitcoin exchange market share averaging at $1,315. On the other hand, Japan, the largest Bitcoin exchange market, is demonstrating an average price of $1,297.
Competitors in the US Bitcoin exchange market including Bitstamp expressed their concerns over the current Bitfinex issue and its conflict with its intermediary banks. Nejc Kodric, CEO of the major US exchange Bitstamp, said in an interview that the recent Bitcoin price trend is not organic. It demonstrates a high level of instability.
"There are three things that an exchange can have trouble with. The first is having a hack, the second thing is being shut down or warned or anything around regulators and the third is getting your accounts shut down. You can survive the first two. But the third is a big one. That's a lethal injection for an exchange.”
If one of the largest exchanges in the US, the second largest Bitcoin exchange market, demonstrates a $100 premium, it would likely act as a driving factor of Bitcoin price. Some analysts predict Bitcoin price will decline in the short-term due to this inorganic growth.